Posted by JT-IN on September 21, 2003 at 09:56:03:
Troy:
Are you certain of this…? Not that it couldn’t be, but 11 yrs would be long time to have an active fc case going, w/o some resolution to it; either cure the default or sell the asset… one or the other.
If that date is correct, and this thing has been lingering for all that time, the amount of judgment and interest owed may be considerably more than you indicate here… Something is a miss, but with this limited info, I can only guess at what it could be…
Another approach, although more advanced and requiring the available cash to pull this off… would be that if the loan has truly been in default all this time, (since 92’), and the owner/seller is willing to work something out, (which if they have hung on this long, is doubtful), but if so, then you could approach the Lender to determine if they an interest in selling this Note & Mtg… (or Deed of Trust). My guess is that if this has been an active problem for them all thsi time, that they would gladly unload the problem on someone else. If the seller is amicable, you could work both sides against the middle… and end up with a larger discount and more profit.
Bottom line here is that something is a miss… and more info is needed to determine what/how, etc…
Need some suggestions for a house going to foreclosure sale
Oct.3. Has been in foreclosure since oct.92, bankruptcy
filed in july '03 & granted, home is back on auction schedule, deficiency waived.
tax value is 123,000. principal + back interest + all
legal fees,etc = $77,798.
House is about 200 yds off golf course, and should
conservatively appraise for $145,000, more realistically
A $150-165,000.
Q: I would like to buy pre-foreclosure from owner,
how does BK play into this situation?
How would the paper trail need to look?
what would be quickest way to finance this deal,esp.
since long term plans would be to refi & cash out
equity and lease property
Any and all comments would be greatly appreciated.
TYPO - Should have been since Oct. 2002 not '92, they
bought the house in 1992. I was wondering why all the
replies were talking about the rarity of this.
I have seen this before, however it is uncommon. The only two cases I have seen like this in the past is where attorney’s have lost their homes in foreclosure. Then they, with the knowledge in hand of how to do this, file every postponement, bankruptcy, debtors court, note from family doctor, or whatever they can think of to get the foreclosure postponed as long as possible. I have personally seen one that started 8 years prior to my buying it.
Now, the problem with this is, he has probably not paid any payments on this house in the last 11 years. If you recall the breakdown of a mortgage payment, there is principal and interest. Interest does not stop just because it’s not paid. So this property probably has a larger balance owed than what you are thinking. You’re best bet is to contact the attorney handling the foreclosure and ask for an opening bid price. They should give this to you. If not, call back later and ask to speak the attorney’s legal assistant. They’ll usually give it you.
But be careful if you try to buy this property before the sale. Does he have any other liens on the property? If so, you know those have to be paid also. And check for any IRS liens. If you don’t send the IRS a letter and receive one back from them, you can be responsible for the taxes owed. And this can really put a hurting on your profit margin.
- Posted by Troy